Multiple Choice
Which of the following would be classified as an external failure cost on a quality cost report?
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6. Internal Controls and Reporting Cash
Fraud and the Fraud Triangle
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Which of the following is NOT an example of safeguarding inventory?
A
Installing security cameras in the warehouse
B
Conducting regular physical inventory counts
C
Allowing all employees unrestricted access to inventory
D
Restricting access to inventory storage areas
Verified step by step guidance1
Understand the concept of safeguarding inventory: Safeguarding inventory involves implementing measures to protect inventory from theft, damage, or loss. This includes physical security, monitoring, and controlled access.
Analyze each option provided in the question: Review the measures listed and determine whether they align with the concept of safeguarding inventory.
Option 1: Installing security cameras in the warehouse - This is a safeguarding measure as it helps monitor and deter theft or unauthorized access.
Option 2: Conducting regular physical inventory counts - This is a safeguarding measure as it ensures inventory records are accurate and helps identify discrepancies or losses.
Option 3: Allowing all employees unrestricted access to inventory - This is NOT a safeguarding measure because unrestricted access increases the risk of theft or mismanagement. Safeguarding inventory typically involves restricting access to authorized personnel only.
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